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The iPhone 4s is 199$ with contract, the galaxy s3 is 198$ with contract. I'm sure the s3 has better specs, but the prices don't seem outrageous. You can get the old iPhone for 0$ with contract. (I don't own either iPhone or samsung).
From what I read, the bigger profit comes largely from the greater share Apple is able to extract from the phone companies. Maybe the phone companies are idiots for giving Apple more money, or maybe they can count.
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